A stock price has an expected return of 18% per annum and a volatility of 20% per annum. Currently the stock price is $30 per share.

1. a) (2 marks) What is the mean of the logarithm of the stock price by the end of two years?

2. b) (2 marks) What is the standard derivation of the logarithm of the stock price by the end of two years?

3. c) (2 marks) What is the width of the 95% confidence interval for the logarithm of the stock price by the end of two years? (Note that N(-1.96) = 0.025, where N(x) is the cumulative standard normal distribution function)